Security

First Home Owners Grant a boost to Loan approvals

19 April 2001

The Commonwealth Bank said today that the recently announced First Home Owners Grant was seeing a positive increase in the number of loan approvals as more new borrowers were able to afford their first home and have the benefit of that additional equity in their new home.

General Manager, Cards and Financing Products, Nick Kennett said: "Our first requirement is to see that the client has actual savings and the income to meet loan repayments. We will lend up to 95% of the value of the property and the First Home Owners Grant can be used towards the deposit provided the client has demonstrated they have saved 5%".

"Borrowing for a home is for most people an important step in building their wealth. But as with all borrowings it needs to be undertaken prudently and that is why we, and our mortgage insurers, look to see that there is genuine savings and not a reliance solely on grants, gifts or other windfalls".

Mr Kennett said that the new grant had prompted many enquiries and coupled with the current special introductory offer of zero establishment fee and a 1 year rate of 5.19% Commonwealth Bank is seeing an excellent response.

As with all loans, each borrower is assessed on their particular requirements and financial position to help ensure the loan best meets their needs and that they can comfortably meet loan repayments.